The Philippine Chamber of Commerce and Industry (PCCI) expects local businesses to consider expanding their operations into Paraguay after it entered into a partnership with the South American country’s export and investment promotion agency.

The PCCI signed a memorandum of understanding (MOU) with Paraguay's Investment and Export Network (REDIEX) as part of the official visit of Paraguay President Santiago Peña Palacios at Malacañang Palace on Monday, May 11.

The agreement between the two parties aims to establish business linkages between Philippine and Paraguayan companies.

PCCI President Ferdinand Ferrer said this would allow local companies to explore the Paraguayan market while also opening the country to Paraguayan businesses.

As the country’s largest business group, he said, there are members of the PCCI who have already expressed interest in taking advantage of this opportunity, signifying their intent to invest in Paraguay.

Among the companies planning to invest are those from the information technology and business process management (IT-BPM), agriculture, and electronics sectors.

Ferrer said Paraguay is particularly attractive to businesses in the Philippines since the country is nearly the complete opposite of the Philippines in terms of time zones, making it possible to continue operations without any downtime.

“The businesses that we can't get because of the time zone element, maybe we can go there,” he told reporters.

He said the South American country is also enticing to local firms given its relatively affordable electricity and tax rates, making it particularly attractive to those in the IT-BPM sector.

Ferrer said companies involved in electronics manufacturing could also consider Paraguay since products made in the country are subject to much lower tariffs when exported to the United States and neighboring countries in the Mercosur trade bloc.

“We want to set up companies there, not to remove work from here, but to capture additional business because of geographic location,” he said.

In addition, Ferrer said the partnership with Paraguay would open new opportunities for the importation of agricultural commodities such as corn, especially as demand continues to outpace local production.

Meanwhile, Paraguay could become a new export destination for the Philippines’ fishing industry, particularly for shipments of tuna, sardines, and milkfish.